Understanding BUMS: Objectives, Functions, Roles, Conditions, and How to Establish It

Understanding BUMS – Understanding the meaning of BUMS is important for those of you who are interested in the national economy. In general, BUMS or Private Owned Enterprises can be understood as one type of company that exists in Indonesia. Companies that are included in the BUMS category have a major contribution to assist the government in efforts to improve the Indonesian economy, one of which is to provide wide employment opportunities for the majority of Indonesian people.

You need to know, in the business world there are many types of business entities that can be established in Indonesia. Almost all existing business entities have their own goals and specifications and differ from one another. This in the end also makes the requirements needed to establish a business entity are also different, including BUMS.

Well, this article will explain what BUMS is. Not only that, it will also explain the objectives, functions, roles, types, advantages and disadvantages, to the various requirements and stages that need to be carried out to establish a BUMS in Indonesia. Here’s the full discussion!

A. Definition of BUMS

The definition of BUMS is basically a type of business entity whose capital is almost entirely owned by private or non-governmental parties. BUMS itself has the goal of obtaining optimal profits while being able to develop business and capital. This of course will greatly support the government’s program to absorb labor from the Indonesian people.

Even so, BUMS is a private or non-government business entity. Companies from still have the responsibility to follow the rules made by the government. If a BUMS is unwilling or unable to follow the existing rules, the government has the right to revoke the company’s business license.

In addition, there are several fields that can be given to the private sector or BUMS. Some of these fields, among others, are fields related to the management of economic resources that are not vital and strategic or can be considered not to affect the interests of many people. Examples of BUMS that have been operating in Indonesia, namely the health sector, industrial sector, trade sector, transportation sector, and so on.

B. Differences between BUMS and BUMN

As stated in the previous section, BUMS is a business that is mostly owned by private or non-government parties. Meanwhile, State-Owned Enterprises or often abbreviated as BUMN can be interpreted as a company whose capital is almost entirely controlled by the government or the state.

The establishment of a state company or BUMN basically has a background for the benefit of the community. Therefore, SOEs will always carry out developments in order to support efforts to advance the Indonesian economy.

Well, in this section, we will discuss about what exactly is the difference between BUMS and BUMN. The following is an explanation of the two that you need to know, including:

1. BUMS is a company that can manage any business outside the vital sector. Meanwhile, SOEs generally manage resources that are considered strategic or involve the lives of the people of a country.

2. BUMS has an orientation or goal to gain as much profit as possible. Meanwhile, BUMN is a company that does not only think about profit, but also the interests of the community. BUMN itself has an obligation to provide the best service for the community, starting from increasing state income to supporting national development programs.

3. BUMS obtains capital from its own strength and independence, both from profits and loans from banks. Meanwhile, BUMN obtain capital from state finances or it can also come from bank loans.

C. Type of BUMS

It is known that there are many types of business entities in Indonesia. Specifically, in this section we will discuss the three types of BUMS that exist in Indonesia. Well, the following is an explanation of the three types of BUMS that you need to know, namely:

1. National BUMS

National BUMS or often referred to as national private companies are companies whose business capital comes from local communities or domestic parties. BUMS itself includes individual companies that are filled by small business actors or individual business entities.

An example of a National Private Owned Enterprise, for example, is a firm built by two or more people. Or it could be limited partnership or CV which is usually founded by many people, both as active and passive partners.

Not only that, the largest size of BUMS itself is a limited liability company or abbreviated as PT. When a BUMS is able to become a PT, it will be very possible to get capital from outside the company.

2. Foreign BUMS

A foreign private company or often called a foreign BUMS can be understood as a company whose business capital comes from a party from abroad or a foreign citizen. In Indonesia, there are already many foreign BUMS, starting from the United States, China, Japan, Korea, and so on. In establishing a company, BUMS usually invests to implement the company in Indonesia

3. Mixed BUMS

As the name implies, this BUMS is a combination of domestic parties with parties from abroad. BUMS or this mixed private company is a form of corporate corporation where almost all of its business capital comes from cooperation between national (domestic) entrepreneurs and entrepreneurs from abroad.

D. The purpose of BUMS

After understanding BUMS and various other types of business entities, in this section we will learn about the real purpose of BUMS itself. Well, here are some goals that you need to know before setting up a private company, including:

1. Help increase state income

A private company has an obligation to always pay taxes to the state. This of course can be used by the government as a way to get income for the benefit of the community.

Even though from the beginning it has an orientation or goal to get optimal profit. BUMS must also have the aim of participating in supporting the economic development of a country. The bigger the BUMS, the higher the income of state funds will be.

2. Create job opportunities widely

It is known that the unemployment rate in Indonesia is quite worrying. The presence of BUMS has proven capable of being one of the answers for people who need jobs. Just like the previous section, the more a private company grows and gets bigger, the workforce required will always increase.

3. Increase the country’s foreign exchange earnings

With the increase in the production of goods from within the country, the country has the opportunity to increase income through foreign exchange. This happens because private companies are able to export and import on a large scale.

4. Increase the prosperity of society

Private companies are known as business entities that are always trying to grow and develop. Thanks to the increased production of goods from within the country, BUMS can have a significant impact in providing welfare and prosperity to the community.

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